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Infonetics: Recovery Abounds in 3 Key Networking Markets

Research firm Infonetics has released a trio of reports that point to definite signs of recovery in key networking markets.

Fourth-quarter ’09 and year-end data show that the Ethernet switch, enterprise router and wireless LAN markets all show signs of an uptick, with sales increasing at least 10 percent from the third quarter of ’09. Sales of wireless LANs held the largest sales gain – 16 percent – year over year from Q4 ’08.

“The Ethernet switch, enterprise router, and wireless LAN equipment markets have improved significantly from the lows set in the first half of 2009, but are still down overall in 2009 compared to 2008,” said Matthias Machowinski, directing analyst for enterprise voice and data at Infonetics Research, in a statement. “With the economic recovery under way, we expect sales to rise across the board in 2010 and beyond as companies make necessary infrastructure investments and slowly expand again.”

The Ethernet switch space rebounded significantly in Q4 of ’09, growing 15 percent sequentially to $4.2 billion. Year over year, Ethernet switch port shipments are up 4 percent, the firm noted.

Revenue in 2009 took a nose dive as more customers migrated to lower-cost switches, although demand remained high. The 10G space, in particular, fared well as worldwide revenue grew 63 percent in 2009 over 2008.

Cisco retained its position as the market leader in Ethernet switches, followed by HP and 3Com.

In the enterprise router category, revenue was up 10 percent in the fourth quarter compared to the third quarter, reaching $821 million. However, it remained down for the full year of 2009, decreasing 28 percent to slightly more than $3 billion. Again, Cisco kept its lead in the market, with revenue share increasing only slightly from the year before.

Wireless LANs saw a significant increase in year-over-year sales, but revenue remained unchanged in Q4, holding steady at $571 million. The overall market was down 6 percent for the full year 2009 despite a more significant drop at the beginning of 2009. Cisco once again leads the market with 46 percent of the worldwide market in both Q4 and all of 2009, followed by Aruba.


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